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Taobao Sellers revolting against the service charge hike by causing havoc online

A large number of irritated small Chinese sellers are creating havoc online against a plan by the country’s leading online marketplace and classified ads site Taobao to increase its fees.

Almost 40,000 small retailers attacked large brands for example Japan’s fashion chain Uniqlo by putting large orders on the site, promptly cancelling them and giving bad feedback.

Taobao Mall, the B2C department of Taobao, which runs similar to a Chinese version of eBay or Amazon, last week declared an as much as ten-fold rise in seller charges from 2012.

The costs will increase from 6,000 yuan ($940) up to 60,000 yuan ($9,400) annually, plus a obligatory arranged deposit will increase from 10,000 yuan ($1,570) to approximately 150,000 yuan ($23,500).

Taobao claimed the rise in the retailers’ deposit will “encourage sellers to operate at Taobao Mall in a more active and serious way”. The deposit is for circumstances when a buyer requests a refund but the seller declines to pay out.

The charge escalation has produced rumours that Taobao plans to squash out smaller sellers like ebay has done, which have responded in a wave of internet protest aimed to the website.

Taobao said Wednesday it had informed the online protest to the local police and promised that it will “by no means put up with the online unrest that damage other innocent sellers.”

Jack Ma (on the picture), the founder of Alibaba and Taobao, said the they would stick to its decision of service charge hike, while an Alibaba spokeperson said on Thursday the company was open to talks with the upset sellers.

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